Frankenmuth Mut. Ins. Co. v. Marlette Homes, Inc.

• Citation: 456 Mich. 511,573 N.W.2d 611
• Decision Date: 24 February 1998
• Docket Number: Docket No. 108377
• Parties: , Prod.Liab.Rep. (CCH) P 15,165 FRANKENMUTH MUTUAL INSURANCE COMPANY, as subrogee of Terry C. Weir And Darlene Weir, Plaintiff-Appellee, v. MARLETTE HOMES, INC., and Coachmen Industries, Inc., as its successor in interest, jointly and severally, Defendants-Appellants.
• Court: Supreme Court of Michigan

Page 611

573 N.W.2d 611

456 Mich. 511, Prod.Liab.Rep. (CCH) P 15,165

FRANKENMUTH MUTUAL INSURANCE COMPANY, as subrogee of Terry C. Weir And Darlene Weir, Plaintiff-Appellee, v. MARLETTE HOMES, INC., and Coachmen Industries, Inc., as its successor in interest, jointly and severally Defendants-Appellants.

Docket No. 108377.

Supreme Court of Michigan.

Feb. 24, 1998.

Plunkett & Cooney, P.C. by Ernest R. Bazzana, Detroit, for defendants-appellants.

Opinion

PER CURIAM.

The plaintiff insured a manufactured home that burned in 1991. As subrogee of the owners, the plaintiff sued the manufacturer. The circuit court granted summary disposition in favor of the manufacturer, relying on a statute of repose. The Court of Appeals reversed the summary disposition, but we reverse the judgment of the Court of Appeals and reinstate the summary disposition in favor of the manufacturer.

I

In 1971, Terry C. Weir and Darlene Weir purchased a manufactured home from Marlette Homes, Inc. The Weirs placed the home on their property in Jeddo, St. Clair County. To insure their home, the Weirs purchased a policy from Frankenmuth Mutual Insurance Company.

On September 18, 1991, the home burned. Frankenmuth Mutual paid $116,525.54 to compensate the Weirs for their loss, and assumed the role of subrogee.

In May 1993, Frankenmuth Mutual sued Marlette Homes and Coachmen Industries, Inc., alleging that a poorly designed vent fan had caused "electrical arcing," which led to the fire. ¹

The defendants moved for summary disposition. MCR 2.116(C)(7), (10). They asserted that this suit was barred by a statute of repose. M.C.L. § 600.5839; M.S.A. § 27A.5839. The motion was heard and granted by the circuit court in November 1994.

The Court of Appeals reversed the summary disposition and remanded the case to circuit court. 219 Mich.App. 165, 555 N.W.2d 510 (1996). ²

Marlette Homes and Coachmen have applied to this Court for leave to appeal.

II

This case involves a statute of repose, ³ which the Legislature enacted in 1967 to protect licensed architects and professional engineers. ⁴ In 1985, the Legislature amended the statute to include contractors within its coverage. ⁵ The amended statute now provides:

No person may maintain any action to recover damages for any injury to property, real or personal, or for bodily injury or wrongful death, arising out of the defective and unsafe condition of an improvement to real property, nor any action for contribution or indemnity for damages sustained as a result of such injury, against any state licensed architect or professional engineer performing or furnishing the design or supervision of construction of the improvement, or against any contractor making the improvement, more than 6 years after the time of occupancy of the completed improvement, use, or acceptance of the improvement, or 1 year after the defect is discovered or should have been discovered, provided that the defect constitutes the proximate cause of the injury or damage for which the action is brought and is the result of gross negligence on the part of the contractor or licensed architect or professional engineer. However, no such action shall be maintained more than 10 years after the time of occupancy of the completed improvement, use, or acceptance of the improvement. [M.C.L. § 600.5839(1); M.S.A. § 27A.5839(1), as amended by 1985 P.A. 188.]

The Legislature also provided a definition of the word "contractor."

As used in this section, "contractor" means an individual, corporation, partnership or other business entity which makes an improvement to real property. [M.C.L. § 600.5839(4); M.S.A. § 27A.5839(4), as amended by 1985 P.A. 188.]

The issue is whether, by producing and placing a manufactured home, Marlette Homes is an entity that "makes" an improvement to real property. ⁶

III

The Court of Appeals correctly stated the principles that govern the analysis of a case of this sort:

The primary rule of statutory construction is to determine and effectuate the intent of the Legislature through reasonable construction in consideration of the purpose of the statute and the object sought to be accomplished. Gross v. General Motors Corp., 448 Mich. 147, 158-159, 528 N.W.2d 707 (1995). Where a statute is clear and unambiguous, judicial construction is precluded. Mino v. McCarthy, 209 Mich.App. 302, 304, 530 N.W.2d 779 (1995). If judicial interpretation is necessary, the Legislature's intent must be gathered from the language used, and the language must be given its ordinary meaning. In determining legislative intent, statutory language is given the reasonable construction that best accomplishes the purpose of the statute. Id. at 304-305, 530 N.W.2d 779. Statutes of limitation, along with statutes of repose, are construed to advance the policy that they are designed to promote. They prevent stale claims and relieve defendants of the protracted fear of litigation. Witherspoon v. Guilford, 203 Mich.App. 240, 247, 511 N.W.2d 720 (1994).

The Court of Appeals noted that the word "makes" is not defined in the statute, but cited a dictionary definition ⁷ as it concluded, "[i]f we were to apply the ordinary meaning of the word 'make' defendant would clearly fall within the definition of contractor." 219 Mich.App. at 170.

Nonetheless, the Court of Appeals held that such a literal construction of the statute would produce an absurd result that was inconsistent with the purpose of the amendatory statute. The Court explained:

In expanding protection to contractors, the Legislature clearly intended to protect from never-ending liability those who are in the business of constructing improvements. The statute is meant to protect providers of individual expertise who render particularized services for the construction of improvements to particularized pieces of real property. Manufacturers of prefabricated, mass produced products were not intended to be included within the statute's definition of contractor. Had the Legislature intended to give increased protection to manufacturers, it could have clearly so stated. Because the modular home was a mass-produced product, and Marlette provided no individualized expertise to construct a particular improvement to it, defendants are not entitled to claim the statute of repose as an affirmative defense.6

IV

We disagree with the Court of Appeals conclusion that the concededly plain language of the statute is rendered inapplicable by a legislative intent to exclude the manufacturers of modular homes. In reaching this conclusion, the Court of Appeals said that a modular home is a "mass-produced product," to which the manufacturer provides "no individualized expertise." The Court went on, in a footnote, to discuss manufactured homes in the context of "products." However, we can identify no bright line that causes a traditional home, constructed on the property where it will remain, to be so fundamentally different from a "manufactured" home that is largely constructed off-site. Technologies change over time, and even conventional on-site construction involves the use of important elements fabricated elsewhere (such as roof trusses).

Such uncertainties regarding legislative intent are to be resolved by applying the previously quoted rules of statutory construction. 219 Mich.App. at 169-170. In this instance, we need not speculate about the evolving nature of the home-construction industry. We need only apply the plain language of the statute. And, as the Court of Appeals acknowledged, applying the plain meaning of M.C.L. § 600.5839(4); M.S.A. § 27A.5839(4) brings the defendants within the statutory definition of contractor. ⁸

Seeing no reason to depart from the explicit language enacted by the Legislature, we reverse the judgment of the Court of Appeals and reinstate the judgment of the circuit court. MCR 7.302(F)(1).

MALLETT, C.J., and BRICKLEY, MICHAEL F. CAVANAGH, BOYLE, WEAVER, MARILYN J. KELLY and TAYLOR, JJ., concurred.

1 The plaintiff alleged that Coachmen was Marlette Homes' "successor in interest," assuming its assets and liabilities.

2 The Court of Appeals later denied rehearing.

3 The Court of Appeals explained how such a measure differs from a statute of limitation:

A statute of repose limits the liability of a party by setting a fixed time after the sale or first use of an item beyond which ...